Devise new strategy to take on competition from multinational brands.
Amid rising competition from a host of multinational players in the packaged beverage space, Rasna is working on a strategy to maintain its market leadership.
The largest and the oldest player in the powdered ready-to-drink market in India is facing stiff competition from players like Kraft Foods India, which has evolved an aggressive marketing strategy for its powdered beverage brand Tang with a new campaign and by sprucing up its distribution network.
Part of Rasna’s strategy involves addressing consumer needs before competition can identify the same.
“We have a whole range of products that span the price spectrum — from Rs 1 satchets to packs that cost over Rs 70. Our strategy is clear: To innovate and take leadership on the product platform,” says Ahmedabad-based Rasna Pvt Ltd’s Chairman & Managing Director Piruz Khambatta.
One such initiative to woo its target group with a “total powder offering”, the company has launched stick packs for its existing Fruitplus drink. It had also stepped into the energy drink space offering three flavours of Rasna Glucose-D in West Bengal.
“I am happy to have competition because that will grow the market. The challenge for me is not a new entrant. We have seen many of them over the last two-and-a-half decades we’ve been around. My concern is how do I get more people to consume powdered beverages.”
While the prepared beverages market in India, including squashes, syrups, and powdered beverages is a Rs 1,000-crore market, the powdered beverages alone being a Rs 400-450 crore segment.
Khambatta says while the market is growing at 20 per cent every year, there is scope for further growth. “India’s per-capita consumption of powdered beverages is just about three to four glasses. Compare this with Philippines, where the per-capita consumption is three times that of India, and you’d realise that India can do with some more of the latter.”
But is the market conducive for new product launches? Khambatta believes it is: “We reinvented the powdered beverage market by making the big shift from being a synthetic product maker to one that is packed with nutrients. All our products today are pitched on the health platform. In this day and age when health consciousness is growing, I think it’s a good alternative as a refreshment.”
Competitors too are speaking the same language. Kraft, which relaunched Tang in April, is pitching the product as one that is packed with iron and vitamins A, B and C.
Narayan Sundararaman, director, powdered beverages, gum & candy, Cadbury India, says: “Findings from our research with mothers and children revealed that a child’s day is no different from that of an adult. The activities they perform during the day in school and through other extracurricular activities deplete essential vitamins in them. The attempt with Tang is to not only provide a quick refreshing drink but also replenish essential vitamins.”
Kraft is using the distribution strength of Cadbury to push Tang (orange, mango and lemon flavours) in four different pack sizes — sachets for Rs 4; 200-gram packs for Rs 35; 500-gram packs for Rs 80 and 750-gram packs for Rs 115. Cadbury sources say more flavours could be added to the portfolio. “It’s the largest powdered beverage brand in the world. And India is a market where we wanted the product to take off well,” says a Cadbury executive.
Available in more than 30 countries, Tang has always attempted to stay relevant to its target audience, mainly mothers and kids, by adapting to local tastes and preferences.
Khambatta, however, dismisses Tang as a “washout”. “It hasn’t made much headway in the last three years it has been around. Let’s see what happens under Cadbury’s.”
But even as Kraft ups the ante with Tang in India, Rasna has other competitors to contend with in powdered beverages like Coca-Cola’s Fanta Fun Times, an orange flavoured drink which was launched last month. “Every few years we have new players in the marketplace. I don’t think that worries us in any way,” Khambatta says.
With over 80 per cent share in the powdered beverage market, Rasna is clearly in the driver’s seat for now. It is attempting to now move into other prepared beverage categories such as squashes — a segment dominated by Hindustan Unilever’s Kissan range.